LIC Housing Finance Q3 Results Review: Motilal Oswal Maintains 'Buy' On The Stock, Sees 24% Upside— Here's Why

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

LIC Housing Finance Ltd. reported muted loan growth and disbursement growth during the quarter primarily due to the loss of business volumes in Bangalore and Hyderabad. Meanwhile, net interest margins remained broadly stable sequentially, while asset quality saw a healthy improvement. The company reported provision write-backs during the quarter, leading to a beat on earnings.

LIC Housing Finance has strong moats in retail mortgages and on the liability side. It has demonstrated its ability to transmit higher borrowing costs to customers. The company is making substantial efforts for a recovery in its project loans portfolio and anticipates more account resolutions moving forward.

LIC Housing Finance’s valuation of ~0.7x FY27E price/book value reflects the inability of the franchise to deliver stronger loan growth. We estimate RoA/RoE of 1.7%/14% in FY27 and maintain Buy rating with a target price of Rs 690 (based on 0.9x Sep’26E BV).

Key downside risks:

1. an elongated period of weak loan growth because of muted demand or high competitive intensity; and

2. volatility in the NIM profile and ECL provisioning.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.